AD or Private - For investment

[calatravato]

Originally Posted by LooseCann0n

The E is 0
Hence the P/E is 0

Watches are not like stocks as an investment class - more like Gold.


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Sorry to be THAT GUY, but if E=0, then P/E is undefined, not 0.

[tyler1980]

Originally Posted by 904VT

I would certainly agree it's a hard asset, but watches are not an asset class. Rolex as a product (more specifically certain vintage models) can be a collectable, which is an alternative investment. To be an asset class, we need to take into account all watches and brands in the universe. Some brands like Patek and Rolex hold their value fairly well. The rest are mostly depreciating assets with no cash flows being generated.

im not necessarily making an appreciation argument. Im looking at it as a hedge since you can protect the asset more easily with insurance.

Its hard to insure a closet full of cash.... and cash also depreciates (inflation)

Just saying if you are conservative and like to have a big chunk of cash or something worth cash , like watches, you can better protect the cash if its in the form of a watch. Obviously it needs to be watches that retain value fairly well but they dont have to appreciate either.

[ppalasthira]

It shouldn’t be just about the money man.

I would just choose wisely and buy sth you like which retains some kind of value if you decide to flip it.

Plus, to get noticed at an AD, you need to spend an insane amount on slower moving pieces just to get on the list on the hotter ones.

[JohnTz]

Watches are not investments. At best you hope to break even on them after a few years if you bought them right and enjoyed them over that time period. I know there are some high flyers but the key point there is "buying them right".

Good luck on that in this environment where the ADs measure their top customers at $500K to several $M in yearly spend. I am personal friends with a person that has spent over $2M at an AD last year and they couldn't even get him a Rainbow Daytona or a 5740. This year he has a couple application pieces coming so he hopes that will get him the 5740. One of them is a repeater.

[danestaff]

Originally Posted by tyler1980

its absolutely an asset class. Think of it this way. Say you want to keep cash/cash equilivant handy. You can insure your watches, you cant insure your cash. Even at the bank as then you need multiple accounts to stay under the insurance limit.



If you want 10 million dollars of watches you can insure them for 10 million dollars. If i had that much money i would want it in somethng i could turn into money and i could insure.

Agree

I also love my watches but also see them as rainy day money, and if you purchase the right ones you should never lose on it, fingers crossed

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[GeraldGentaFan]

Originally Posted by calatravato

Sorry to be THAT GUY, but if E=0, then P/E is undefined, not 0.

Isn’t it infinite rather than undefined? Vaguely remember that from math classes long ago!

[emtee]

I think it depends what the OP means by investment. If he means what watches can I buy that I can sell later for substantial profit then the comments are fair enough as if that was a given then everyone would be doing it.

But if he means ‘I love watches so which ones should I plough my 75K into so I get to enjoy my love of watches but won’t take a bath if I need to sell’ then that’s a different question.

I see my very modest collection as an investment in as much as I know I could sell them and probably come out even. Some up some down. I don’t consider other expensive purchases such as car/clothes/electronics as investments as I know they are worth a fraction of what I paid for them now they are second hand.

[1688]

Originally Posted by JohnTz

Watches are not investments. At best you hope to break even on them after a few years if you bought them right and enjoyed them over that time period. I know there are some high flyers but the key point there is "buying them right".

Good luck on that in this environment where the ADs measure their top customers at $500K to several $M in yearly spend. I am personal friends with a person that has spent over $2M at an AD last year and they couldn't even get him a Rainbow Daytona or a 5740. This year he has a couple application pieces coming so he hopes that will get him the 5740. One of them is a repeater.

Haha...watches are not investments...tell that to the 1% who are the ones on most ADs waitlists. New collectors without the capital has no chance.

https://www.nytimes.com/2019/03/20/s...e-watches.html

[Fat_ninja]

Everyone should have a 5711 plan lol

[danestaff]

Originally Posted by Fat_ninja

Everyone should have a 5711 plan lol

Thankfully I have and its flourishing well

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[ts3]

Originally Posted by Fat_ninja

Everyone should have a 5711 plan lol

Like with credit cards you got the silver plan, the gold plan, and the acclerated platinum plan...

Eligibility doesn't even require US tax citizenship, more or less available worldwide at your AD!

[Bearxj86]

Originally Posted by calatravato

Sorry to be THAT GUY, but if E=0, then P/E is undefined, not 0.

Oh my gosh guys. Seriously? I think the statement I made can be interpreted without all of this clarification.

[ap1]

Buy LOW, sell HIGH. You are too late

[Fat_ninja]

Originally Posted by ap1

Buy LOW, sell HIGH. You are too late

Buy high sell HIGHER. Never too late. We need more people to prop up prices since 99% of my net worth is in watches

[ap1]

Originally Posted by Fat_ninja

Buy high sell HIGHER. Never too late. We need more people to prop up prices since 99% of my net worth is in watches

Lol. I was looking for the import photo in vanguards 529 site but was unable to find it. There was a link to my bank account though so I used that this month.
It’s weird, they accepted my no date sub in January.

[904VT]

Originally Posted by GeraldGentaFan

Isn’t it infinite rather than undefined? Vaguely remember that from math classes long ago!

It means you need to use the inverse and find the earnings yield. Or look to another multiple like P/S

Some use negative P/E with loses, since we're not looking at absolute values

[Fat_ninja]

Originally Posted by 904VT

It means you need to use the inverse and find the earnings yield. Or look to another multiple like P/S

Some use negative P/E with loses, since we're not looking at absolute values

You guys are being way too serious. Look im a professional and id like to think a rather good one. My secret....
1) im bad at math
2) i know how to use a ruler cause the trend is your friend

I have no idea what pe ps or pee pee is.

[aa909]

Originally Posted by bearxj86

Oh my gosh guys. Seriously? I think the statement I made can be interpreted without all of this clarification.

sorry but your statement was fundamentally incorrect. P/E=0 means the Price is 0, not the Earning. E=O means P/E = Infinity

[904VT]

Originally Posted by Fat_ninja

You guys are being way too serious. Look im a professional and id like to think a rather good one. My secret....
1) im bad at math
2) i know how to use a ruler cause the trend is your friend

I have no idea what pe ps or pee pee is.

All just in good conversation, but I would never look at P/E for watches. I hope you understand the first two if you're in the business, but I'm sure you understand the 3rd if you have kids

[Fat_ninja]

Originally Posted by 904VT

All just in good conversation, but I would never look at P/E for watches. I hope you understand the first two if you're in the business, but I'm sure you understand the 3rd if you have kids

Im just kidding, im not in the business... i watch a lot of billions

[ts3]

No offense, but me thinks the TRFers who have outed themselves in this thread as challenged when it comes to simple math and valuation methods would want to sign up for ...

some adult education class... ... or start having a few beers together

[danestaff]

Originally Posted by ts3

No offense, but me thinks the TRFers who have outed themselves in this thread as challenged when it comes to simple math and valuation methods would want to sign up for ...

some adult education class... ... or start having a few beers together

Did someone mention beers



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[904VT]

Originally Posted by Fat_ninja

Im just kidding, im not in the business... i watch a lot of billions

Great show for sure!

[francoamerican]

My expectation: No Rolex (or Sub 150K Patek) that are produced in 2019 will net an increase more that CPI over the next 20 years. And many will do much worse.

If Patek sold and were cheapened by the buyer then there is a small possibility the Pre-Conglomerate Pateks would have a premium

The only possibility for appreciation above CPI is in the super high-end Patek, vintage or handmade (Roger Smith level if we're talking current production)

FA

[jerryguo]

Watches are accessories and generally have poor investment performance.

[controlz]

Thank you for all of your input and this rather "hard" welcome to the forum. Perhaps I deserve this beating by the way I described 'investment' however my question was sincere.

I have zero interest in flipping watches to make a few quid - I am more than happy with my current means of income. I have the liquidity to spend on things I enjoy (be it cars, homes, travel), but one of those is watches and what I find particularly appealing is they can be a way to preserve capital or even gain if you purchase the right product. These would likely pass onto my children.

Emtee hit the nail on the head here:

Originally Posted by emtee

But if he means ‘I love watches so which ones should I plough my 75K into so I get to enjoy my love of watches but won’t take a bath if I need to sell’ then that’s a different question.

Re vintage watches - these just don't appeal to me. I like new and shiny. Same with sports cars! TIA

[tchaic]

Welcome to the forum Controlz! I think your last post spot on. Under that view I’d try to meet a good AD, buy from any available source the watches you have to have today, and take the long approach. It’s a great hobby and I enjoy allocating some of my capital to watches. Not as investments but as a reasonable store of capital and something I thoroughly enjoy wearing, having, and playing with. This forum can be a wealth of knowledge so don’t let the initial welcome dissuade you from hanging out.

[Jojoshop]

Didn’t read the thread but neither, a watch is not an investment


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[sensui]

Originally Posted by controlz

Thank you for all of your input and this rather "hard" welcome to the forum. Perhaps I deserve this beating by the way I described 'investment' however my question was sincere.

I have zero interest in flipping watches to make a few quid - I am more than happy with my current means of income. I have the liquidity to spend on things I enjoy (be it cars, homes, travel), but one of those is watches and what I find particularly appealing is they can be a way to preserve capital or even gain if you purchase the right product. These would likely pass onto my children.

Emtee hit the nail on the head here:



Re vintage watches - these just don't appeal to me. I like new and shiny. Same with sports cars! TIA

It just hits a nerve with most of the guys because of all the threads and sentiments regarding this in media in the last years that's a tad unprecedented. I don't think you have a bad idea but trying to do it through these types of watches is going to be hard to "gain" in the long run. You'd either have to:

1) Buy some other watches/jewelry that'd tank the moment you walk out the store.....and then finally have a shot to buy a hot piece @ msrp over time.

2) Pay the current market premiums (pretty much all time high) for these hot in demand pieces.

Neither are really good decisions if you're thinking investment....to win @ this you'd have to sort out the hobby itself and gamble on upcoming trends that you believe....so it's really just like anything else in terms of investments (a gamble).

This is why no one recommends newer players like yourself to play this game for "investment"......buy the watch you like to pass on to your kids to enjoy.

[francoamerican]

Overall, watches are better than cars for value retention.

My expectation: if you are looking at new only, the only thing you can wear
(and not completely baby) that will very likely still worth more used than msrp three to five years from now are (AP 15202st, almost any nautilus or aquanaut or the steel daytona and possibly steel blue or blue/red c GMT, YM 42mm green c sub)

To get access to those watches MSRP you have to buy things that will drop 20% immediately below what you paid unless you are very careful with the watches and are willing to sell them yourself in forums or to friends.

Are there watches without 3-10 year wait lists, that will at least recover the 20% hit you take in nominal terms someday?

If you must buy new, i think the steel black ceramic subs are your best bet.

The value buys, if you are willing to go to a top tier second hand dealer IMO?

1. 116520
2. 14060